The 2016 European Referendum – the ‘in’or ‘out’ debate

The date’s set – on 23 June 2016 UK citizens vote to stay in or leave the European Union. Napo’s not mandated either way on the EU but this article is designed to pull out some of the key issues to help our members make an informed decision.

What is the EU?

The EU has evolved into an economic, trading and political partnership of 28 countries. Decisions are taken by a Council of Ministers, monitored by the European Parliament and informed by the European Commission and social partners.

Its roots rest in the ashes of WW2 and a view that closer co-operation rather than competition would build greater understanding and make peace more sustainable; Europe also being able to act as a block to counter-balance emergent superpowers. Over time the EU grew in size and influence, the single market and free movement of goods and people spreading East after the collapse of the Communism. Some countries are more
pro-co-operation than others, in part depending upon their traditions – the UK traditionally rejects interference or regulation whilst Germany and the Nordic countries have social partnership in their constitutions. Political perspectives are also influenced by national economic and social priorities and countries look to get different things from EU membership. This means all countries have varying relationships with the EU. It also means generally the EU has to do things by agreement, which can isolate some countries if their priorities are significantly out of step with other partners. The UK has never been a leading European enthusiast and gets concessions on the budget, regulations and the currency. Cameron’s ‘deal’ is an extension of these concessions. The EU does not include the European Court of Human Rights which sits in the European Council.

What does Cameron’s Deal deliver?

Conservative leader David Cameron faces deep divide in his party over Brexit. More than 100 Tory MPs including Boris Johnson and Michael Gove have made it clear they want out of the European Union.

Cameron’s deal includes:

Child benefit payments for children living overseas being recalculated to reflect the cost of living in their hom countries.

The UK can limit in-work benefits for EU migrants during their first four years in the UK. This “emergency brake” can be applied in “exceptional” levels of migration, for a maximum of 7 years.

Any British money spent on Eurozone bail-outs will be reimbursed. As now Britain can keep the pound and trade without discrimination with the bloc.

There will be greater protection for the UK financial services industry from EU regulations.

A specific exemption from any commitment to “ever closer union” for the UK in any existing or future EU Treaty.

Adjustments making it easier for EU legislation to be blocked or over turned by national parliaments – if 55% of national EU parliaments object to a piece of EU legislation it will be rethought.

Calls on all EU institutions and states to “make all efforts to fully implement and strengthen the internal market” and to take “concrete steps towards better regulation”, including by cutting red tape, although this sits in contrast to limits on free movement – denying free movement to those outside of the EU who marry EU nationals, alongside powers to exclude people thought to be a security risk and efforts to limit migration between EU nations.

Why have a referendum?

Shortly after joining the EU the UK held a referendum and voted to stay in. The Conservative Party strongly supported EU membership whilst many on the left opposed. Since then, as the EU has evolved and grown, and the global and UK economies have shifted, this balance has largely changed, with many on the right resenting EU regulations on business in particular. Since the early 2000’s, the Conservatives have been deeply split on the EU. The global economic crisis heightened a sense that national parliaments had lost power and control. Cameron has resisted a referendum and his insistence on seeking to re-negotiate Britain’s membership terms allowed for the vote to be held off until after the 2015 General Election.

What do the political parties say?

Opposition Leader Jeremy Corbyn is expected to play a lower profile in the EU debate. Although the official Labour party line is to vote IN, Corbyn is known for being a long time EU sceptic.

Over 100 Tory MPs and several Cabinet Ministers have openly declared for the OUT camp, against the Government position. Boris Johnson and to a lesser extent Michael Gove have been criticised for choosing OUT in a perceived effort to align themselves with Tory members ahead of a leadership election, with Cameron having declared he will leave office before the next General Election.

Labour’s more united behind its official stance to campaign for IN but Jeremy Corbyn’s well known for being a long time EU sceptic and is expected to play a lower profile in the campaign than may otherwise have been expected given Tory divisions. Corbyn and Labour have criticised Cameron’s deal for failing to focus upon the big issues facing Europe such as climate change, the refugee crisis, job security, holding global corporations to account and the threat of TTIP. Labour’s promoting a more cohesive, proactive and progressive EU.

The SNP, Greens and Plaid Cymru are all voicing similar support for a progressive EU. The Nationalist parties are especially tied to independence within the EU. The DUP meanwhile have announced that they will be supporting the OUT campaign.

The arguments

SovereigntyThe primary philosophical argument put forward by OUT campaigners is the UK is best left to make its own decisions for itself without interference or the need to compromise from outsiders with different priorities and interests. As an island Britain is separate and has different interests. This point is generally followed by explanations of how large, unaccountable and undemocratic the EU is.

The strongest supporters of the EU are quick to counter this as unrealistic and a defeatist, isolationist position at odds with the UK’s tradition for seeking to be a positive influence on a global stage. They argue you can have no real influence shouting from the sidelines and that we should try harder, using the strength of our global brand, to have more influence on shaping and improving how the EU works.

Few go as far as defending the EU’s institutions or saying it couldn’t work much better but many point out that our own institutions aren’t perfect, with lower election turnouts and our electoral system giving total power on around 24% of the total popular vote. A drift towards a United States of Europe worries many but the IN campaigners argue Cameron’s Deal protects the UK if our Parliament didn’t want to further integrate.

Business and the Economy

The EU started as an economic union and IN campaigners would generally see the business case for staying IN as their strongest argument. Many prominent OUT campaigners admit that the impact of opting-out is unknown and uncertain. IN supporters argue the EU is our largest trading partner and 3 million jobs directly rely on EU trade. Many parts of the UK have used EU grants and funding for re-generation after the demise of manufacturing and heavy industry. The majority of business leaders and 55% of CBI members support staying in.

OUT campaigners argue the UK could and would still access the single market without being bound by regulations and membership costs as Norway and Switzerland currently do. They also argue they could get a better deal by re-negotiating trade agreements free from EU regulation and constraints.

However, IN campaigners point out that Norway and Switzerland still pay for access to the single market without a say; still have to follow some regulations to be allowed to play with the EU; and the regulations are not why the UK has the lowest productivity in the G8 – what one businessman sees as anti-competitive a worker can see as a protection, such as rules around working time limits, holiday pay and rights for flexible workers. It’s also true that the UK has opt-outs or breaks on many business regulations, including around the single currency.

Workers’ Rights and the TTIP

When the UK joined the EU many on the left argued an economic union would prioritise capital over people and that workers’ security would be undermined. They particularly argued the relative weakness of the European Parliament limited workers’ capacity to challenge the powerful vested interests of big business. This argument’s been echoed by some small business owners saying the EU is directed by lobbying from big corporate interests.

This is an argument that has some resonance globally, for example opposition to Wall Street and big business in both sides of the current US election debates. The proposed Transatlantic Trade and Investment Partnership (TTIP) debate encapsulates these tensions and arguments. Those opposed to the TTIP say it would give a green light to mass privatisation across Europe, negatively impacting on workers’ rights, jobs, collective bargaining and standards of living with little or no room for EU nations to challenge it, even when they go wrong.

IN campaigners are split over TTIP – as in the States, politicians on the right tend to support it saying it’s a natural extension of free trade in a service based economy; those on the left saying almost all trade agreements include similar clauses allowing companies to sue countries now, as we’ve seen in Germany around environmental standards. It follows, they argue, that this calls for greater international regulation not less and this can best be secured and challenged collectively rather than the UK seeking to negotiate trade agreements without TTIP. It is hugely doubtful that a right wing UK government negotiating regulation light trade agreements wouldn’t embrace TTIP principles in separate trade agreements, indeed some Tories are arguing the risk of the EU stopping TTIP by voting IN.

On balance, the referendum has drawn into the open a debate about how international trade works and is policed but it is debateable whether voting IN or OUT would resolve the debate one way or the other.

Immigration is one of the most contentious issues in the EU debate. Some in the OUT camp say free movement across the 28 member countries has put the NHS and social services under tremendous strain, as well as aiding to housing and job shortages. IN campaigners counter this arguement by saying free movement allows the UK to plug skills shortages and that most migration to this country comes from outside of the EU (Image Courtesy of Queen’s University Belfast)

Immigration

This is one of the most talked about and contentious issues with regards to the EU referendum. Arguably, the EU is used as a vehicle for voicing insecurities arising from how the UK has changed and continues to change as a result of globalisation and increased freedom of movement since the 1970’s, coinciding with the UK joining the EU although we’ve always had, and continue to have more migrants arriving from outside the EU. In short, a sovereign state should have control of its own borders and membership of the EU means we are limited in preventing some outsiders coming here.

Few on either side argue they want to stop all immigration – citing the need for high skilled professionals to fill UK skills gaps, including increasingly in the public services like health and education. Many do however, challenge low skilled workers coming from developing Eastern European economies taking low skilled jobs in areas of high unemployment, often coinciding with areas of relatively low migration from the Old Empire heightening the emotional challenges around integration. This tension is heightened by austerity and limits on a local authority’s capacity to meet increased housing and welfare needs – migration of low paid workers adding to, if not causing, the challenge.

The facts are hard to establish because of the hype and hysteria around the subject. The ONS say around 395,000 EU migrants are currently claiming benefits in the UK, including in work benefits, far less than the number of UK citizens living and working in Europe – e.g. a fraction of the number of ‘ex-Pats’ living in Spain. Various academic studies produce inconclusive arguments about the economic benefits or costs of EU and/or general migration, usually depending upon who paid for the research. Most migrants into the UK are not from Europe but places like Australia and India and increasingly the Far-East, particularly students. Further, IN campaigners argue you can’t have free movement of goods and services without free movement of people and we benefit from this freedom, also arguing migrants contribute more to our economy than we pay out in benefits – although citing potential retaliatory action post any UK opt-out and Spain returning our ex-pats could be argued as showing the hype and hysteria isn’t one sided in the debate.

How the EU deals with the on-going refugee crisis is a relevant and urgent backdrop to the debate. Most in the OUT campaign argue the crisis shows the only way we can control our borders is opting out of the EU whilst the strongest supporters of IN argue this would be a retreat, signifying the UK was no longer willing to play a part, let alone lead in an international crisis, instead aligning with neutral states like Switzerland. Some on both sides will recognise that IN or OUT will make little difference to those seeking refuge in the UK – by 24 June this will be more urgent and complex than ever either way.